Correlation Between Precious Metals and Advent Wireless

Can any of the company-specific risk be diversified away by investing in both Precious Metals and Advent Wireless at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Precious Metals and Advent Wireless into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Precious Metals And and Advent Wireless, you can compare the effects of market volatilities on Precious Metals and Advent Wireless and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Precious Metals with a short position of Advent Wireless. Check out your portfolio center. Please also check ongoing floating volatility patterns of Precious Metals and Advent Wireless.

Diversification Opportunities for Precious Metals and Advent Wireless

-0.27

Correlation Coefficient

Precious Metals  Advent Wireless

Very good diversification

The 3 months correlation between Precious and Advent is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Precious Metals And and Advent Wireless in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advent Wireless and Precious Metals is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Precious Metals And are associated (or correlated) with Advent Wireless. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advent Wireless has no effect on the direction of Precious Metals i.e., Precious Metals and Advent Wireless go up and down completely randomly.

Pair Corralation between Precious Metals and Advent Wireless

Assuming the 90 days trading horizon Precious Metals And is expected to generate 0.56 times more return on investment than Advent Wireless. However, Precious Metals And is 1.77 times less risky than Advent Wireless. It trades about 0.13 of its potential returns per unit of risk. Advent Wireless is currently generating about -0.07 per unit of risk. If you would invest  209.00  in Precious Metals And on April 23, 2025 and sell it today you would earn a total of  27.00  from holding Precious Metals And or generate 12.92% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Precious Metals And  vs.  Advent Wireless

Precious Metals And

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Precious Metals And are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat abnormal basic indicators, Precious Metals sustained solid returns over the last few months and may actually be approaching a breakup point.

Advent Wireless

Risk-Adjusted Performance

Very Weak

Over the last 90 days Advent Wireless has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Pair Trading with Precious Metals and Advent Wireless

The main advantage of trading using opposite Precious Metals and Advent Wireless positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Precious Metals position performs unexpectedly, Advent Wireless can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Advent Wireless will offset losses from the drop in Advent Wireless' long position.

The idea behind Precious Metals And and Advent Wireless pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.